“That´s Crazy!”

Some strategic decisions seem to be crazy to go for but …. what if the figures show a drag on profit?

In my last BLOG-post I wrote about Intel´s problem with their memory when the Japanese competitors grew stronger and stronger and Intel´s Board saw no threat for a long time. Until, in mid 1985, it was suddenly too late to react to the market. Now someone had to make a decision.

And they reached that decision with a certain moment of clarity, when Grove discussed the following with Chairman and CEO Gordon Moore: ” If we got kicked out and the board brought in a new CEO, …. what do you think he would do?”

Gordon Moore replied: “He would get us out of memories.”

Which is exactly what both decided to do. The simple thought, a thought outside their own box, the clear view of a bigger picture which is asking: “what would our successor do?” helped getting the answer for a clear decision.

As you can imagine, many colleages were furiously opposed to this idea. But what they did next was the proper activator of the start of this decision process. They asked their sales force to talk to all their customers and it was actually their reaction which drove Intel directly out of the memory business.

The decision to let go completely of their original business product turned out to become a boost for Intel´s domination on the microprocessor market. The conflict both men were facing in 1985 when turning to the direction to quit the old memory-project was the hardest part to overcome. They were both confronted with short-term emotion.

Strategic decisions are never easy to take but one day we all reach a point in life that forces us to make a sharp U-turn.